According to Labour, there are many reasons for Bitcoin’s rise from November 2023 onwards. The approval of Bitcoin ETFs triggered one of the largest outflow cycles in financial history. ETF inflows will exceed $20 billion in 2025. The halving in 2024 will reduce supply and create demand based on scarcity.
He further stated that the regulatory preferential treatment provided by the existing US administration, the so-called Trump effect, was due to an improved investment environment for crypto assets. The Cryptocurrency Promotion Act allows for institutional investor entry and broader market legitimacy.
Institutional internalization of German banknotes progresses
According to Deutsche Bank analysts, institutional adoption remains one of the key drivers of Bitcoin growth. Exposure from companies such as MicroStrategy, corporate treasuries, and hedge funds has increased. Central banks are also considering using Bitcoin to diversify their reserves.
This usage pattern has made Bitcoin more similar to gold, but Labour doesn’t rule it out. He wrote that Bitcoin is less volatile than before, acting more like digital gold as a hedge against currency declines.
Banks deny speculative risk
On a positive note, Labour reiterated that Bitcoin is highly speculative. She said Bitcoin has no inherent value and is unstable. Deutsche Bank’s model does not predict Bitcoin will reach $1 million. Strategists were cautious because volatility could hurt short-term gains.
This opinion reflects Deutsche Bank’s more general attitude, which is optimistic about blockchain’s potential but rather skeptical about unsupported digital assets.
Comparison: Bitcoin and Gold
Bitcoin and gold will remain on parallel lines even in 2025. Both assets benefited from diversification of central bank holdings due to inflation and a lack of geopolitical rationale. Nevertheless, while gold has a fixed intrinsic value (based on physical scarcity), Bitcoin relies on network trust.
According to Rabour, Bitcoin’s movement is similar to that of gold in terms of hedging, but gold is still better in terms of long-term stability due to physical support. But analysts say Bitcoin’s digital portability could be strategic for modern investors.
